Simple Interest
Math MCQs

Question :    Calculate the amount due if David borrowed a sum of $3400 at 10% simple interest for 4 years.

Correct Answer  $4760

Solution & Explanation

Solution

Given,

Principal (P) = $3400

Rate of Simple Interest (SI) = 10%

Time (t) = 4 years

Thus, Amount (A) = ?

The Rate of Interest is always calculated per annum, i.e. per year.

Thus, here 10% simple interest means, Rate of Simple Interest (SI) is 10% per annum.

Method (1) Using Formula

Calculation of Simple Interest

Formula to Calculate Simple Interest

Simple Interest (SI) = Principal × Rate × Time

Thus, Simple Interest (SI) = $3400 × 10% × 4

= $3400 ×¹⁰/₁₀₀ × 4

= ^{3400 × 10 × 4}/₁₀₀

= ^{34000 × 4}/₁₀₀

= ¹³⁶⁰⁰⁰/₁₀₀

= $1360

Thus, Simple Interest = $1360

Calculation of Amount

The total money paid to the lender by a borrower is called the Amount.

In other words, sum of priciple and interest is called the Amount.

Formula to Calculate the Amount

Amount = Principal + Interest

Thus, Amount = $3400 + $1360

= $4760

Thus, Amount to be paid = $4760 Answer

Method (2)

Calculation of Amount when Principal, Rate of Simple Interest and Time are given

Calculation of Amount directly using Principal, SI, and Time

Formula to calculate the Amount

Amount (A) = Principal (P) + Principal(P) × Rate of Interest (SI) × Time (t)

⇒ A = P + PRT

Here in the question, P = $3400

Rate of Simple Interest (SI) or (R) = 10%

And, Time (t) = 4 years

Thus, Amount (A)

= $3400 + ($3400 × 10% × 4)

= $3400 + ($3400 ×¹⁰/₁₀₀ × 4)

= $3400 + (^{3400 × 10 × 4}/₁₀₀)

= $3400 + (^{34000 × 4}/₁₀₀)

= $3400 + (¹³⁶⁰⁰⁰/₁₀₀)

= $3400 + $1360 = $4760

Thus, Amount (A) to be paid = $4760 Answer

Method (3) Unitary Method

Calculation of Amount using Unitary Method

Calculation of Interest using Unitary Method

Here, given Rate of Simple Interest = 10%

This, means, $10 per $100 per year

∵ For $100, the simple interest for 1 year = $10

∴ For $1, the simple interest for 1 year = ¹⁰/₁₀₀

∴ For $3400, the simple interest in 1 year

= ¹⁰/₁₀₀ × 3400

= ^{10 × 3400}/₁₀₀

= ³⁴⁰⁰⁰/₁₀₀ = $340

Thus, simple interest for 1 year = $340

Therefore, simple interest for 4 years

= Simple interest for 1 year × 4

= $340 × 4 = $1360

Thus, Simple Interest (SI) = $1360

Calculation of Amount

Amount = Principal + Interest

Thus, Amount = $3400 + $1360

= $4760

Thus, Amount to be paid = $4760 Answer

Similar Questions

(1) William had to pay $3710 in order to furnish the loan taken 3 years before. If the rate of simple interest was 2% then find the sum borrowed.

(2) If Sarah paid $4466 to settle his loan which he had taken 4 years before at a simple interest of 4%, then find the loan taken.

(3) James took a loan of $4000 at the rate of 9% simple interest per annum. If he paid an amount of $6880 to clear the loan, then find the time period of the loan.

(4) Find the amount to be paid if Michael borrowed a sum of $5300 at 4% simple interest for 7 years.

(5) Jennifer took a loan of $4500 at the rate of 9% simple interest per annum. If he paid an amount of $8145 to clear the loan, then find the time period of the loan.

(6) Calculate the amount due if Elizabeth borrowed a sum of $3450 at 8% simple interest for 4 years.

(7) Find the amount to be paid if Richard borrowed a sum of $5600 at 4% simple interest for 8 years.

(8) Joseph took a loan of $5400 at the rate of 10% simple interest per annum. If he paid an amount of $9720 to clear the loan, then find the time period of the loan.

(9) Calculate the amount due after 10 years if Elizabeth borrowed a sum of $5450 at a rate of 10% simple interest.

(10) Find the amount to be paid if Sarah borrowed a sum of $5850 at 5% simple interest for 7 years.